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The U.S. Bureau of Labor Statistics published its Consumer Price Index report on September 11, 2024, that says Arizona’s mimimum wage effective January 1, 2025 will be $14.70 an hour. The 2024 minimum wage is $14.35 an hour.  The 35-cent minimum wage increase is directly tied to the latest CPI report, which showed a 2.5% increase in inflation from August 2023 to August 2024.
The post Arizona Increases Its Minimum Wage to $14.70/Hour in 2025 appeared first on Arizona LLC Law.
Continue Reading Arizona Increases Its Minimum Wage to $14.70/Hour in 2025

A distribution from a limited liability company (LLC) is a payment of cash or property made by an LLC to the LLC’s owners, also known as members. Although state law sets forth certain default rules, LLC members can specify in the LLC’s operating agreement when and how profits are allocated, distributed, and taxed.
Distribution Method and Timing
Under the default rules provided by most state LLC statutes, an LLC is not required to make any distributions to members before they withdraw from the LLC or it is dissolved. It is prudent for LLC members to create an operating agreement that…
Continue Reading What Is an LLC Distribution?

Question:  I am completing IRS Form W-9, Request for Taxpayer Identification Number and Certification.  Line 1 says “Name of entity/individual.”  I am completing the W-9 for my single-member LLC.  What do I put in line 1?
Answer:  For a sole proprietor or disregarded entity, enter the owner’s name on line 1, and enter the business/disregarded entity’s name on line 2.
The post Do I Put My LLC’s Name on Line 1 of an IRS Form W-9 appeared first on Arizona LLC Law.
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Minnesota copyright attorney Christopher T. Porter discusses the United States Supreme Court decision in Warner Chappell Music, Inc. v. Nealy. Call 612.455.6218.
Continue Reading Warner Chappell Music, Inc. v. Nealy – U.S. Supreme Court Holds Copyright Act Places No Time Limit on Infringement Damages

The following is the text of an email I got from Tanya M. Gibson, Director, Corporations Division of the Arizona Corporation Commission on May 1, 2024:

Hi, All! It has been a while since I have reached out. I hope everyone is well and staying cool!
I have good news to share! We have secured a vendor for our new filing system! Yes, we are replacing eCorp. We are excited because the new system is technologically advanced and offers a great deal of features and functionality that will enhance the customer experience, streamline filings, and better protect against fraudulent filings.
Continue Reading Arizona Corporation Commission is Making a New Website

The following is a March 4, 2024, news item on FinCEN’s website:
On March 1, 2024, in the case of National Small Business United v. Yellen, No. 5:22-cv-01448 (N.D. Ala.), a federal district court in the Northern District of Alabama, Northeastern Division, entered a final declaratory judgment, concluding that the Corporate Transparency Act exceeds the Constitution’s limits on Congress’s power and enjoining the Department of the Treasury and FinCEN from enforcing the Corporate Transparency Act against the plaintiffs. FinCEN will comply with the court’s order for as long as it remains in effect. As a result, the government is not currently…
Continue Reading Federal District Court Rules Corporate Transparency Act Unconstitutional

Question:  Can my lender call my loan that encumbers my land if I transfer the land to an LLC I own?
Answer:  Probably not.  The Federal National Mortgage Association, aka Fannie Mae, has something called Servicing Freddie Mac Mortgages Series 8000.  Section 8406.4(b) Additional permitted Transfers of Ownership Effective 10/20/2021 states:
“Permitted Transfers of Ownership subject to conditions.  In situations where all of the following conditions are met, Freddie Mac will permit a Transfer of Ownership of the Mortgaged Premises:

  • At least 12 months have passed since the Origination Date and
  • The transfer is to a limited liability company (LLC) or limited partnership (LP), provided

…
Continue Reading Loan Can’t be Called if Land Is Transferred to an LLC

Question:  Did you file my LLC as partnership? My tax accountant needs this information and a copy of that document.
Answer:  You need to get a new accountant who understands LLCs and federal income tax law. It is not possible in any state to file an entity (corp or LLC) as a partnership for federal income tax purposes. The IRS’ default tax method for a multi-member LLC like your two member LLC is partnership. No need to file any papers with the IRS other than the LLC’s IRS form 1065, which is its partnership tax return. If the LLC wants…
Continue Reading Did Your File My LLC as a Partnership?

A business partnership or limited liability company is a go-to for many entrepreneurs or experienced business owners. They say, “Two heads are better than one” and are not wrong. More people mean more resources, knowledge, experience, and ideas. But what happens when not everybody agrees to the same ideas? That is when disputes arise.
Common sources of partnership disputes
Breach of fiduciary duties
Breach of fiduciary duty occurs when a party is responsible for acting in the interests of another but fails to do so or does so dishonestly.  An example would be if a manager of an LLC diverts…
Continue Reading What should you do in case of a partnership or member dispute?

President of an Arizona nonprofit corporation I formed recently called while at the bank trying to open a bank account for the corporation.  The corporation filed IRS form 1023EZ and was a 501(c)(3) tax-exempt charity.  The banker said her bank could not open a bank account until the corporation could prove its “tax classification.”  I asked her what she meant by “tax classification” and she said it means is the corporation a C corporation or an S corporation?  I said neither because it is a 501(c)(3) tax-exempt charity.  She insisted the corporation had to be a C or an S…
Continue Reading Another Wells Fargo Idiot Banker

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Question:  If my Arizona LLC is called Widget World, LLC and I want to use Best Widgets in my LLC’s advertisements do i need to file a DBA with Arizona?
Answer:  DBAs in AZ are called trade names.  If you use text that is not the full name of the LLC you should register that text as a trade name with the Arizona Secretary of State.  Getting a trade name or dba from the Arizona Secretary of State is relatively easy to do. It’s a simple online application and the fee is $10. To learn how to get the trade name…
Continue Reading Should I Get a DBA for My Arizona LLC?

The Minnesota legislature has passed a bill aimed at combatting the dissemination of “deep fake” videos and images. The bill was passed 131 to zero and is expected to be signed into law by Governor Walz within days. Anticipating what is expected to be an explosion in the use of artificial intelligence (“AI”) to create […]
Continue Reading NEW MINNESOTA PRIVACY LAW CREATES CAUSE OF ACTION FOR DISSEMINATION OF “DEEP FAKES”